Martin v. M.N.R., docket 98-376-UI

Date: 19990423

Docket: 98-376-UI

BETWEEN:

ANDRÉ MARTIN,

Appellant,

and

THE MINISTER OF NATIONAL REVENUE,

Respondent.

Reasons for judgment

Tardif, J.T.C.C.

[1] This is an appeal from a decision dated February 16, 1998, in which the respondent determined that the work performed by the appellant, André Martin, for Promotions CPM Inc. (the "payer") during the period from February 25 to August 29, 1997 was not done pursuant to a contract of service within the meaning of the Employment Insurance Act (the "Act").

[2] The respondent made the following assumptions of fact in support of the determination:

[TRANSLATION]

(a) The payer operates a business hiring people to promote credit cards in major stores.

(b) During the period in issue, the appellant was employed by the payer to promote the credit card issued by The Bay.

(c) The appellant supplied only a pencil and "liquid paper", while the payer supplied the forms to be completed by the customers and the store supplied a work table and bonus gifts.

(d) The appellant was generally supposed to work between 9:30 a.m. and 3:00 p.m., Tuesday to Friday, but his hours worked were not recorded by the payer.

(e) The appellant had no maximum or minimum number of hours to work.

(f) The appellant had no quota of applications to be completed; he had to hand over the completed applications to the payer once a week.

(g) The appellant claims that he was required to provide the services himself, whereas the payer claims he could be replaced.

(h) The appellant was remunerated solely on a commission basis; he received $3 per application card completed.

(i) The appellant determined his remuneration based on the time and energy he wanted to devote to his work.

[3] After being sworn, the appellant admitted the content of all the allegations except for paragraphs (e) and (g), which read as follows:

[TRANSLATION]

(e) The appellant had no maximum or minimum number of hours to work.

(g) The appellant claims that he was required to provide the services himself, whereas the payer claims he could be replaced.

[4] Lucille Martin and her spouse, the appellant in the instant case, testified in support of the appeal. The respondent had Louise Denis testify in her capacity as owner of Promotions CPM Inc.

[5] The testimonial evidence revealed that the credit hosts (persons soliciting customers in a store in order to have them fill out an application form for that store's credit card) were recruited through newspaper advertisements. Candidates then met Louise Denis or Lucille Martin for an interview. Those whose appearance was good and who could speak well, had a certain degree of availability and agreed to be paid essentially by commission, that is to say, $3 per form completed, were automatically recruited.

[6] Following a brief training period, the solicitors were scheduled and placed in various stores to begin solicitation efforts with a view to having credit cards issued for the store where they worked. These solicitors were described as credit hosts.

[7] The appellant performed this kind of solicitation work during the period in issue. His spouse was a representative with Promotions CPM Inc. and was also a credit hostess since her work as a representative did not keep her busy enough.

[8] As a representative of the company, she was authorized to hire, dismiss and supervise the work of credit hosts, including that of her spouse, the appellant. She decided where the credit hosts were to work and the number of hours they had to work. She obtained a performance report every day and corrected the completed forms before sending them to Ms. Denis in Montréal.

[9] On the balance of evidence it has been clearly established that the content of paragraphs (e) and (g) has no basis in fact. It appears from the evidence that the appellant was essentially paid by commission during the period in issue. However, he had to submit daily reports on his work using a form provided by the employer. He also had to comply with a work schedule, and the company's representative selected the location where the work was to be performed. The work had to be done in accordance with specific instructions and the application forms had to be completed properly so that the requested credit card could be issued.

[10] During the period in issue, the appellant performed work for which he was remunerated on the basis of the number of completed applications. This work was performed under strict supervision. The appellant had none of the flexibility or freedom characteristic of self-employed workers.

[11] Contrary to the respondent's claims, the appellant could not have the work done by a replacement. He had to do his work during scheduled periods and adhere to a specific timetable, although he did not have to punch a time clock.

[12] Notice had to be given before every absence so that the employer could ensure continuity of service.

[13] It was also shown that, if the hosts had to pay any expenses in order to perform their work, they were reimbursed for those expenses. Although the appellant alone determined how much he would earn, he could not incur financial losses and did not have to pay any expenses.

[14] Remuneration was essentially based on performance or productivity. On this matter, the evidence established that this method of payment was the only effective one, although it considerably limited the number of persons interested in the work, as the vast majority of people preferred a guaranteed salary.

[15] We are not dealing here with self-employed workers or independent contractors, in particular for the following reasons:

the payer or its representative directed the soliciting and decided in which store it was to be done;

a work schedule setting the number of days and number of hours had to be met;

the solicitors, including the appellant, had to comply with a code of conduct with regard to the persons solicited;

the quality of the work done was reviewed daily and subject to remarks and comments which the solicitors had to take into account or risk losing their jobs.

[16] In performing his work, the appellant had to dress well and use appropriate language.

[17] The duration of the employment depended on demand from the major stores, but also on the quality and quantity of work performed.

[18] The solicitors or credits hosts supplied none of what they needed to perform the work. They could of course increase their income through dynamism and enthusiasm in doing their work, but incurred no loss if their performance was disappointing. They did not operate their own businesses, but were an essential component of the business which paid them solely on a commission basis.

[19] Consequently, it may be concluded from an analysis and assessment of all the terms and conditions and circumstances of the performance of the work done by the appellant during the period at issue that he worked under a contract of service. The work performed by the appellant met all the tests set out in the case law for a contract of employment insurable under the Act.

[20] For all these reasons, the Court allows the appeal on the basis that the work which the appellant performed for Promotions CPM Inc. between February 25 and August 29, 1997 was insurable employment within the meaning of the Act.

Signed at Ottawa, Canada, this 23rd day of April 1999.

"Alain Tardif"

J.T.C.C.

[OFFICIAL ENGLISH TRANSLATION]

Translation certified true on this 31st day of January 2000.

Erich Klein, Revisor